Reverse-Mortgage-Truth.com

Proprietary Reverse Mortgages:

Financial Freedom Cash Account Advantage reverse mortgage: 6.37% (Index is 6 month LIBOR at 2.87% plus margin of 3.5%)

Bank of American Independence Plan 210 reverse mortgage and Independence Plan 360: Bank of America has suspended their proprietary reverse mortgage program.

FHA HECM Reverse Mortgage rate: 3.43% (Index is the 1 Year CMT at 1.93% plus a margin of 1.5%)

FHA Fixed rate Reverse Mortgage - HECM: 6.7% to 6.81%

These are interest rates, not APR’s and do not include closing costs. A full reverse mortgage quote can be found here.

The following are today’s reverse mortgage interest rates for the most popular reverse mortgage products:

HECM Reverse Mortgage rate: 3.13% (Index is the 1 Year CMT at 1.63% plus a margin of 1.5%)

Fixed rate Reverse Mortgage - HECM: 6.05% to 6.81% (depending on the lender)

Independence Plan 360 jumbo reverse mortgage: 6.28688% (Index is the 6 month LIBOR at 2.68688 plus a margin of 3.6%)

Independence Plan 210 jumbo reverse mortgage: 4.78688% (Index is 6 month LIBOR at 2.68688 plus a margin of 2.10%)

Cash Account Advantage jumbo reverse mortgage: 6.21% (Index is 6 month LIBOR at 2.71% [rounded] plus margin of 3.5%)

Interest rates are not an APR and do not include closing costs. Please contact your California reverse mortgage lender for a quote.

The following headline was sent in an email to mortgage brokers this morning from a major reverse mortgage lender:

10,000 Americans Are Turning 62 Everyday!
With a current market penetration of less than 2%, the Reverse Mortgage industry is taking off. Get in on the ground floor . . .

Sounds a bit like the great California gold rush of the mid-1800’s. Or perhaps like the great California home mortgage refinance boom of the early 2000’s.

Since 62 is the minimum age for the reverse mortgage, an additional 10,000 people per day being added to the market for potential reverse mortgage candidates certainly sounds like the gravy train that all mortgage brokers should not miss. But there’s a lot more to this than meets the eye.

How many of those who are newly 62 have at least 70% equity in their homes? That’s about what it takes to qualify for a reverse mortgage in California. Who has that much equity? It’s anyone’s guess as to the percentages, but it is highly probably that the majority of homeowners turning 62 have either bought their California homes recently with a large mortgage or have cashed out much of their home equity through refinancing.

And of that now dramatically smaller group, how many actually need a reverse mortgage in California? Homeowners do not get a reverse mortgage unless they have real reason. Some want to get rid of their mortgage payment for the rest of their lives. Others want a line of credit with no payment obligations so they can get a new roof or remodel the kitchen. But without a motivating factor, people do not change the status quo.

Still, 10,000 people per day is a huge number. Some of them will be good candidates for the California reverse mortgage. But will it be the next gold rush or home mortgage refinance boom? Only time will tell.

The following are today’s reverse mortgage interest rates for the most popular reverse mortgage products:

HECM Reverse Mortgage rate: 3.10% (Index is the 1 Year CMT at 1.6% plus a margin of 1.5%)

Fixed rate Reverse Mortgage - HECM: 5.74% to 6.81% (depending on the lender)

Independence Plan 360 jumbo reverse mortgage: 6.21438% (Index is the 6 month LIBOR at 2.61438 plus a margin of 3.6%)

Independence Plan 210 jumbo reverse mortgage: 4.71438% (Index is 6 month LIBOR at 2.61438 plus a margin of 2.10%)

Cash Account Advantage jumbo reverse mortgage: 6.13% (Index is 6 month LIBOR at 2.63% [rounded] plus margin of 3.5%)

Interest rates are not an APR and do not account for closing costs. Please contact your reverse mortgage lender for a quote.